Andrew Williams became the CEO of Halma plc (LON:HLMA) in 2005. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Andrew Williams’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Halma plc has a market cap of UK£6.2b, and is paying total annual CEO compensation of UK£3.4m. (This figure is for the year to March 2018). While we always look at total compensation first, we note that the salary component is less, at UK£625k. When we examined a selection of companies with market caps ranging from UK£3.0b to UK£9.0b, we found the median CEO total compensation was UK£2.5m.
As you can see, Andrew Williams is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Halma plc is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see, below, how CEO compensation at Halma has changed over time.
Is Halma plc Growing?
Halma plc has increased its earnings per share (EPS) by an average of 17% a year, over the last three years (using a line of best fit). It achieved revenue growth of 13% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Shareholders might be interested in this free visualization of analyst forecasts.
Has Halma plc Been A Good Investment?
Most shareholders would probably be pleased with Halma plc for providing a total return of 90% over three years. This strong performance might mean some shareholders don’t mind if the CEO were to be paid more than is normal for a company of its size.
We compared total CEO remuneration at Halma plc with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.
However, the earnings per share growth over three years is certainly impressive. On top of that, in the same period, returns to shareholders have been great. Considering this fine result for shareholders, we daresay the CEO compensation might be apt. Shareholders may want to check for free if Halma insiders are buying or selling shares.
If you want to buy a stock that is better than Halma, this free list of high return, low debt companies is a great place to look.
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If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.